Economic Breakdown and Recovery: Theory and Policy

Front Cover
M.E. Sharpe, Feb 8, 1994 - Business & Economics - 287 pages
This is a thoroughly revised and expanded version of an earlier edition. Cornwall builds an economic theory and makes policy recommendations on the central issues of economic growth, full employment, stagnation, inflation, and unemployment all developed within a Post Keynesian framework. The revision carries the analysis through to the present day with the core theme being the challenge of high unemployment as the cost for conventional anti-inflationary policy.
 

What people are saying - Write a review

We haven't found any reviews in the usual places.

Contents

610 Why Were Unemployment Rates So Low in the OECD?
123
611 Conclusions
125
Breakdown
129
II2 Stability Downward Instability Upward
132
II3 Instability Downward Stability Upward
133
Unemployment Performance since the Breakdown
135
Unemployment in the Postwar Period
138
73 Why Did Some Succeed?
142

12 Why Do Governments Choose Unemployment Policies?
16
13 The Basic Causes
17
14 A Framework for Studying Performance
20
16 The Second Limitation
22
17 An InstitutionalAnalytical Approach
23
The Evolutionary Nature of Twentiethcentury Capitalism
26
22 A Comparison of Unemployment and Growth Rates
27
23 The Rise of the Welfare State
28
24 The Rising Power of Labor
31
25 Industrial Relations and the Rising Power of Labor
34
26 Strike Activity and the Size of the Welfare State
35
27 Inflation and the Rising Power of Labor
37
28 The Breakdown in the Early 1970s
39
29 Conclusions
42
A Reappraisal of Vertical Phillips Curve Analysis
44
32 The Natural Rate Hypothesis Once More
45
33 New Strands in Vertical Phillips Curve Analysis
49
34 The Alpha Strand
50
The Beta Strand
55
36 Some Counterarguments
57
37 Hysteresis Effects
60
38 Conclusions
62
The Reliability of Nonaccelerating Inflation Rate of Unemployment Estimates
65
Pigou Reborn
67
Some Basic Determinants of Unemployment
69
42 Public Choice Theory
70
43 Policy Outcomes and Organizational Competition
72
44 Party Control as an Explanation of Policy Choices
73
45 Crosscountry Analysis
75
46 Party Control and Economic Policy
76
47 A Political Economists Analysis of Unemployment
79
48 The Basic Causes of Unemployment
81
49 A Question of Terminology
82
410 A Multitude of Constraints
83
411 The Relevant Institutional Constraints
84
Macroeconomic Performance and Institutions
87
52 Party Control and Unemployment before the Breakdown
88
53 The Impact of Unions on Inflation
90
54 Inflation as a Prisoners Dilemma
92
55 Why Phillips Curves Differ
94
56 Corporatism
97
57 Social Democratic Corporatism
99
58 Pluralist Economies
100
59 Bourgeois Democratic Corporatism
101
510 Alternative Forms of Corporatism Switzerland
103
511 Alternative Forms of Corporatism Japan
104
512 Why the Crosscountry Phillips Curve is Horizontal
106
513 Conclusion
108
Econometric Tests of Institutional Influences
109
63 Simple Correlations
112
64 Unemployment Rates 19631973
113
65 Unemployment Accounting
116
66 Crosscountry Differences in the Misery Index Price Inflation and Wage Inflation 19631973
118
67 Tarantellis Study
119
68 An Evaluation
120
69 What Can We Learn from the Experience before the Breakdown?
122
74 Conclusions
145
A Formal Analysis of the Immediate and Basic Determinants of Unemployment and Inflation
146
High Inflation and Policyinduced High Unemployment
152
82 The Variablecoefficient Phillips Curve
153
83 Fairness and the Dynamics of Inflation
155
84 Variablecoefficient Models of Inflation
157
85 The EcksteinBrinner Model of Inflation
158
86 The Workings of the Model
160
87 Are Workers Fooled?
162
89 Hysteresis and the Variablecoefficient Phillips Curve
167
810 Conclusions
169
Analytical Solutions
173
Regression Analysis
178
Explaining the Breakdown
181
92 The Great Postwar Inflation
182
93 Stages of the Great Inflation
183
94 Breakdown
186
95 The Rising Inflation Costs
188
96 The Ineffectiveness of Traditional Payments Policies
190
97 Conclusions
194
A Model of Longrun Mass Unemployment
197
102 Exporting Unemployment
200
104 Looking to the Future
202
105 Why Restrictive Aggregate Demand Policies Are So Costly
204
106 Why Restrictive Aggregate Demand Policies Are Ineffective in the Long Run
207
107 Conclusions
208
Recovery
213
III2 Outline of Part III
214
The Boom of the 1980s and its Aftermath
216
113 A Nonlinear Model of the Cycle
219
114 The Relationship between Booms and Slumps
221
115 Path Dependence in the 195973 and 198292 Periods
223
116 The Aftermath
227
A Program for Economic Recovery in the United States
230
122 Paradigms and Recovery Programs
231
123 The Unemployment Record in the Twentieth Century
233
124 An Outline of the Program
236
125 Creating the Ideological Climate Keynes Reborn Part One
239
126 Creating the Ideological Climate Keynes Reborn Part Two
240
127 Budget Dynamics and the Interaction of the Budget and the Economy
242
128 Creating the Ideological Climate the Social Bargain
244
129 The Hierarchy of Policy Goals
245
1210 A Diagrammatic Exposition
247
1211 The Clinton Program for Recovery
249
1212 What About the Demand Side?
250
1213 What About the Supply Side?
251
1214 Conclusions
253
Choosing the Future
256
132 Recreating the Nineteenth Century
257
133 A Program for the Future
262
134 Studying Economic Breakdown
263
135 Path Dependence in Capitalist Development
264
136 Choosing the Wrong Future
266
Bibliography
269
Index
277
Copyright

Other editions - View all

Common terms and phrases

Popular passages

Page xxxii - Pursuing the analogy to pornography, perhaps we should treat the term involuntary unemployment as synonymous with 'pornographic unemployment': joblessness without redeeming social value. This suggests an operational definition. Ask the following simple question of job losers and job leavers: would you willingly take your previous job back on the terms now available in the market? If the answer is yes, the person is involuntarily (or pornographically) unemployed. This seems a straightforward test...

Bibliographic information